Greenwich Hospital went under the knife on Wednesday, announcing the layoffs of 36 employees and a series of cutbacks to what it characterized as non-core programs to offset the loss of revenue from a newly implemented state hospital tax.

A Yale-New Haven Health System affiliate and the town's largest employer, the hospital estimated it needs to make up for $8.5 million in lost revenue.

The hospital's top administrator blamed the situation on the state, which now gets a 4.6 percent cut of all hospital income as part of a flat tax enacted on July 1.

"We said that there would be significant consequences to that budget if it were passed, and it fell on deaf ears and here we are," said Frank Corvino, the hospital's president and chief executive.

"The reductions are a direct result of the actions by the Malloy administration -- their disregard for the value of the community hospital," said Tesei, a Republican.

Malloy's administration responded by calling into question whether the hospital did everything in its power to control costs.

"It's hard to take seriously the complaints of a facility that, despite the belt-tightening going on across the state and nation, continues to think it's more important to serve surf and turf than it is to implement common sense cost controls that would help save jobs and benefit their patients," said Juliet Manalan, a spokeswoman for Malloy.

Manalan was referring to the culinary menu of the hospital, which is widely known for serving filet mignon or lobster to parents of newborn babies.

No estimate was available on how much it costs to provide such frills, which hospital spokesman George Pawlush characterized as a key element of the patient experience at the facility.

"It is important that we don't diminish the patient experience at Greenwich Hospital and this includes our menu and quality of our food," Pawlush said. "A great patient experience has enabled us to build our reputation as the most `highly recommended' acute care general hospital in the tri-state area according to the most recent federal government Hospital Consumer Assessment of Health Plans Survey data."

The hospital employs 1,800 people, none of whom Corvino said are represented by unions, at its main Perryridge Road campus and several satellite facilities in town.

"These days are very, very difficult for us at the hospital," Corvino said. "This is a caring institution."

Notable cuts include the elimination of the hospital's on-site pharmacy, the audiology/hearing service component of the physical medicine program and an outpatient dental clinic. The latter may require approval from the state Office of Health Care Access since an entire clinic would be shuttered.

"Every single employee in the institution was affected because of the restructuring of some of the compensation programs that we have, and we've asked employees to pay additional amounts into their medical benefits," Corvino said.

The latter facility opened four years ago at 35 River Road in Cos Cob and provides holistic treatment options such as acupuncture, yoga and massage.

"We think it's been a great asset to the community," Corvino said. "Unfortunately, it has not been profitable."

Corvino emphasized that the hospital's administration and its board of directors took into account other factors when deciding where to make cuts.

"In fact, all of the services that we have mentioned here were not profitable, but that was not the sole basis for our decision," Corvino said. "Our approach here was to preserve our core services that are needed by our community."

A message seeking comment from Dr. Henri Roca, the alternative treatment center's medical director who Corvino said will still serve patients through a private practice, was left Wednesday at his office.

Those functions will be relocated and consolidated into the hospital's main campus, with a membership-based exercise program at Holly Hill eliminated outright.

"Good lord. That's awful," said Richard Bergstresser, 77, who was first selectman from 2001 to 2003 and pays to use the facility.

At the recommendation of his cardiologist, Bergstresser enrolled in the monitored exercise program at the Healthy Living Center when he was in office and continued as a dues-paying member there.

"I've found it tremendously valuable and I hate to see it go," Bergstresser said.

Health Living Center clients will receive refunds on a pro-rated basis on their paid memberships, according to the hospital, which also announced a restructuring of its Center for Healthy Aging. The facility will be moved away from the hospital's main campus to another location that is yet to be determined.

A Democrat like the governor who was in office when Malloy was mayor of Stamford, Bergstresser questioned whether the hospital could have found savings elsewhere.

"If they're doing so much cost-cutting, what are they doing about Corvino's $1.5 million salary?" Bergstresser said. "It seems to me that they should do some trimming before they do layoffs."

Yale New Haven Health System uses a third-party consultant to gauge executive compensation levels, according Pawlush, who said that Corvino wears two hats.

In addition to his duties as hospital president and chief executive, Corvino is executive vice president of Yale New Haven Health System.

"Each organization contributes half of Frank's total earnings," Pawlush said. "Frank's experience in hospital administration has given him the skills needed to successfully balance both of these highly demanding roles simultaneously."

Malloy's office drew attention to that very relationship between Greenwich Hospital and the Yale New Haven Health System, however.

"They might also want to talk to their business associate, Yale New Haven Hospital, which realized a $25 million windfall due to the provider tax," Manalan said.

Although Greenwich Hospital is under the same umbrella as Yale New Haven, Corvino has said that each hospital in the network is financially autonomous.

Greenwich Hospital is the only medical facility in the network to resort to cuts because of the controversial tax, according to Leah Colihan, a spokeswoman for Yale New Haven Health System.

"Neither Yale New Haven (Hospital) nor Bridgeport (Hospital) have any cuts at this point, but Greenwich was disproportionately hit," Colihan said.

Connecticut became eligible for $150 million in federal funds that the state can put toward deficit-reduction as a result of the hospital tax, which also applies to Medicare payments.

Malloy is turning to $1.5 billion in tax increases and layoffs of 6,500 state employees -- depending on a potential concessions deal with state unions -- to close a $3.4 billion budget gap inherited by his administration.

Tesei scoffed at the Malloy administration's dig at the hospital's menu.

"I don't really think that the governor's administration is really in any position to give advice on cost cutting when it failed miserably in producing a balanced budget for the state," Tesei said.

Corvino vowed that the hospital's core services would be insulated from the cutbacks.

"I will tell you that quality and safety at this organization will be as high as ever," Corvino said.

Staff writer Neil Vigdor can be reached at neil.vigdor@scni.com or at 203-625-4436.